Suspending or closing a sole trader in Armenia

What people call "freezing" a sole trader is, in the Tax Code, a declaration of suspension of activity. It is filed with the tax authority, either open-ended or for a set term (article 53(8)). The sole trader stays registered, and some tax obligations stop.

Can you suspend retroactively?

No. The date activity stops cannot be earlier than the day the declaration is filed (article 53(8)). If a sole trader has not worked for three months but filed nothing, the returns for those months still have to be filed. So file the declaration as soon as you stop working.

Do you file returns during a suspension?

For the whole reporting periods inside the pause, no tax returns are filed, "zero" returns included (article 53(8)). A period counts as whole separately for each tax: for turnover tax it is the quarter (article 259(1)), for annual returns the year. For example, if the pause starts on 15 February, the turnover tax return for the first quarter is filed, and the annual return is filed for any year in which you worked for at least part of the time.

What a pause gives you on each regime

A sole trader on turnover tax does not calculate or pay the 5,000 AMD monthly profit tax for the whole months of the pause (article 125(3), point 1). A newly registered sole trader who files the declaration no later than the day after registration can start the pause from the day of registration and owes nothing for the whole months from that day (point 2 of the same part).

A sole trader on the general regime may skip the profit tax advance payments for the whole quarters of the pause (article 135(7)).

What you can still do during a pause

The Code lists what does not count as resuming activity (article 53(9)):
— paying employees' salaries and benefits; the monthly income tax and social payment return is then filed;
— administrative expenses (rent, interest, utilities and subscriptions, including software and licences) and receiving interest on a deposit or account balance; the returns needed to declare them are filed;
— making payments to counterparties and receiving payments from them, and confirming the settlement documents they issue for administrative expenses and for expenses before the pause;
— filing a tax regime declaration;
— paying taxes, filing returns or corrected returns, and undergoing an audit.

What carries on

The annual state duty keeps accruing during the pause (article 53(8.1)) — until the grounds set by the Law on State Duty arise. This concerns activities for which such a duty exists.

How to resume

A pause for a term ends on the day stated in the declaration; an open-ended one ends with a declaration of resumption. If activity actually resumes without a declaration, it counts as resumed from the day it actually resumed (article 53(8)), and all obligations return from that day.

How to close a sole trader in Armenia

Closing means removing the sole trader from state registration. It starts at the State Register, which notifies the tax authority online; the authority then passes on the sole trader's tax liabilities on record as of that date (article 298(1) and (2)). The sole trader counts as deregistered when the Register makes its entry (part 3 of the same article), and the returns and payments for the trading period are recorded under the individual (part 4).

Which to choose

If you plan to come back — seasonal work, a move to another country, a long spell in salaried employment — a pause is usually simpler: the sole trader and its tax ID (TIN) stay, and one declaration is enough to resume. If you do not plan to come back, closing is the more logical choice. Either way, first check that the returns for past periods are filed and nothing is owed. We can check your tax account and prepare the declaration correctly.